Faced with the rising prospect of “bare counties” with no marketplace plans, insurers have stepped in to offer coverage — in part because they see an opportunity to make money with alternative models, experts say.
While more than 80 counties with 92,000 enrollees had been at risk of becoming “bare” in 2018, residents of all but one county in the U.S. now will have access to an ACA health plan next year thanks to the lobbying efforts of state officials in both red and blue states, according to Politico.
“Typically risk-averse insurers have rushed in to serve those small pockets of the country both to save Obamacare — and because they saw a chance to make money,” the report says. “Since the overwhelming majority of Obamacare customers qualify for income-based subsidies, they will be largely immune to huge premium increases and unlikely to drop coverage. That gives a lone insurer incredible power to set higher rates.”
Such is the case for Centene, which signed up to sell plans in more than half of the 81 counties in Nevada that were at risk of being barren next year, including 14 counties where no insurer had filed plans for 2018, according to Politico.
“For 2018, we intend to grow this profitable segment of our business,” Centene CEO Michael Neidorff said on a call with investors last month.
The only potential region without an ACA offering in 2018 is a rural western Ohio county where just 334 people enrolled this year. Jillian Froment, director of the Ohio Department of Insurance, told Politico that she is “hopeful” she can still attract a company to Paulding County.
While insurers like Centene are being applauded for stepping up to the plate, “that doesn’t mean everything is hunky-dory,” Jonathan Cohn writes in for the Huffington Post.
“Centene’s business model relies on narrow physician networks to keep premiums down, which isn’t what all consumers would prefer,” Cohn writes. “And although the number of truly bare counties has now shrunk to nearly zero, there are still many that only have one insurer.”
While roughly 40 percent of all counties will have just one exchange insurer in 2018, those counties are disproportionately rural, with few people living in them, he writes. Even before the ACA was enacted, insurers typically found rural counties “inherently difficult” to manage because of the less-than-ideal healthy-sick ratios, and “because the relative paucity of doctors, hospitals and clinics makes it impossible for insurers to play providers off of one another to get lower prices.”
Cohn listed several ways policymakers could mitigate this risk, including creating new “reinsurance” programs, which subsidize the consumers with the most serious medical problems — something that Alaska and Minnesota have already done. Other options include expansions of Medicaid, Medicare or the federal employee health plan.
“Some of these ideas would do more that merely stabilize markets,” he writes. “They would make health care more affordable for the millions who still can’t pay for it easily, a problem that even most Obamacare defenders concede the law did not fully solve.”
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